The Members,
 
 The Directors have pleasure to present the Twenty- Sixth Annual Report
 on the performance of your Company together with Audited Balance Sheet
 and Profit & Loss Account for the Financial Year ended 31st March, 2011
 and the report of the Auditors thereon:
 
 Financial Performance:
 
                                                        (Rs. in Lacs)
 
                                              2010-11          2009-10
 
 1.  Net Sales                                1,07,795          93,912
 
 2.  Other Receipts                              1,553           1,353
 
 3.  Total Expenditure                          77,698          72,000
 
 4.  Gross Profit : (1 2-3)                     31,650          23,266 
     (before deducting any
     of the following)
 
     (a) Interest                                7,034           1,624
 
     (b) Depreciation                           12,508           8,804
 
     (c) Provision for Deferred Tax             (2,983)          (324)
 
     (d) Provision for Current                    2,415          2,220
         Income Tax
 
     (e) Tax adjustment of earlier years         (3,619)           263
 
 5.  Net Profit                                  16,295         10,678
 
     Add: Balance brought forward                10,340         10,071
          from Previous Year
 
                                                 26,635         20,749
 
 6.  Appropriations :
 
     General Reserve                              3,000          2,000
 
     Expansion Reserve                            7,000          4,000
 
     Proposed Dividend                            4,395          4,409
     (including Dividend Tax)
 
     Carried to Balance Sheet                    12,240         10,340
 
     TOTAL                                       26,635         20,749
 
 Dividend
 
 Your Directors are happy to recommend a Dividend of Rs. 2.50 per share
 (i.e.@ 25%) on 15,12,51,188 Equity Shares of Rs.10/- each fully paid up,
 for the year ended on 31st March, 2011. The total outgo on account of
 Dividend shall be about Rs. 4395.00 Lacs including Corporate Tax on
 Dividend. The Dividend, if approved by the shareholders at the ensuing
 26th Annual General Meeting, shall be paid to all those Members, whose
 names shall appear on the Register of Members of the Company on the
 Books Closure Date i.e. on Tuesday, the 13th September, 2011.
 
 OPERATIONS:
 
 Vadodara Station – I (145 MW CCPP):
 
 Your Directors are happy to inform that Gas Based Station-I at Vadodara
 achieved Plant Load Factor (PLF) of 80.10% for the year under review.
 
 During the year under review the Station generated 1017.46 Million
 Units (MUs) at a PLF of 80.10% as compared to 1204.73 MUs at a PLF of
 94.85% in the preceding year. Planned shut downs including the major
 inspection of GT 2 were taken during the year. The Plant Availability
 Factor (PAF) was maintained at 94.72% during the year.
 
 Vadodara Station – II (165 MW CCPP):
 
 During the year under review the Station generated 843.55 MUs at a PLF
 of 58.36% (Commercial PLF of 81.7%) as compared to 1064.38 MUs at a PLF
 of 73.64% in the preceding year. The Station has undergone scheduled
 overhaul during the year under review. The Station had PAF of 89.21%
 for the year.  The PLF achieved was considerably lower as compared to
 preceding year mainly on account of shortage of gas from RIL-Niko’s KG
 D6 field and also due to backing down of the Plant as per Grid demand.
 
 Your Directors are pleased to inform that your Company has been making
 all possible efforts to tie up adequate supply of gas for the gas based
 Power Stations at
 
 Vadodara. Currently out of total gas requirements of 1.55 to 1.60
 MMSCMD for Vadodara Stations, 1.01 MMSCMD is tied up with GAIL (India)
 Ltd. (GAIL) and RIL -Niko on firm long term basis. The remaining
 quantity is tied up with Gujarat State Petroleum Corporation Ltd
 (GSPCL) and GAIL for supply of Spot gas on as and when required
 basis.
 
 During the year under review major energy conservation and efficiency
 improvement measures by way of modification in various auxiliaries and
 redefining operational parameters have been successfully implemented.
 
 Safety Performance:
 
 The health and safety of all the employees is prime concern of the
 Company. Your Company is making sincere and committed efforts to
 maintain the safety of plant equipment and creating a safe and healthy
 working environment for the employees. The Company is exclusively
 spending approx. Rs. 19.00 Lacs for the health and safety related
 activities. Constant efforts are made to maintain accident free
 operations at all the locations. Your Company has adopted a
 comprehensive Health and Safety policy under the Integrated Management
 System (IMS).
 
 Surat Lignite Power Plant (SLPP):
 
 Phase I of the Station achieved a PLF of 79.63% with generation of
 1743.79 MUs as compared to 1826.75 MUs at a PLF of 83.41% in the
 preceding year.
 
 Constant endeavors are being made to improve the overall performance of
 the Stations, including technology improvement and modifications. The
 required maintenance programme for upkeep of the Units was undertaken
 during the year under review.
 
 Mining:
 
 Your Directors are happy to inform that the performance of Mining
 Division remained very good during the year under review. Total
 quantity of lignite was met from our captive Vastan Mine and Mangrol
 Mine and Limestone from Vastan Mine. To meet the demand of Units 3 & 4
 of SLPP Expansion, Lignite production of Mangrol Mine was also started
 from 22nd May 2010 and sufficient quantity of Lignite has been stocked
 for the operations of Phase II Expansion Project - Units 3 and 4 -
 during monsoon. During the year under review, total overburden removal
 in Mangrol Mine was 15.23 Million CuM and has supplied 6.77 Lac tonnes
 of lignite.
 
 Your Directors are happy to inform that the total quantity of lignite
 and limestone mined from Vastan Lignite Mine during the year under
 review was 18.42 lac te and 1.68 lac te respectively, which is an all
 time record.
 
 Expansion Plans:
 
 SLPP Station-I, Phase II : 2x125 MW (Unit-3 & 4) Expansion Project
 
 Unit-3
 
 Your Directors are happy to inform that Unit-3 of 2x125 MW Expansion
 Project –pending its Performance Guarantee test was declared
 commercially available to the State grid in terms of Power Purchase
 Agreement (PPA) with Gujarat Urja Vikas Nigam Ltd. (GUVNL) from 19th
 April, 2010 and has been supplying power to the State grid in
 accordance with PPA. Unit-3 has been capitalized in the books of
 accounts of the Company during 2010-11.
 
 Unit -4
 
 Your Directors are happy to inform that Unit 4 of 2x125 MW Expansion
 Project - pending its Performance Guarantee test was also declared
 commercially available to the State grid in terms of PPA with GUVNL
 from 28th April, 2010 and has been supplying power to the State grid in
 accordance with PPA. Unit-4 has been capitalized in the books of
 accounts of the Company during 2010-11.
 
 Thus Phase II of the Station commenced its operations during April 2010
 and generated 874.34 MUs at a PLF of 42.55%. The PAF was maintained at
 60.89%. The Station is in the process of stabilized operations.
 
 SLPP Station –II: 2x250 MW   20% Power Project
 
 Your Directors are pleased to inform that your Company is also in the
 process of setting up a 2 x 250 MW (  20%) thermal Power Project (SLPP
 Station II) based on Circulating Fluidised Bed Combustion (CFBC)
 technology including development of a captive lignite mine thus
 increasing the generating capacity of SLPP to 1000 MW Plus.
 
 The Bid / tender have been invited through International Competitive
 Bid (ICB) route for the said Project. The Bids received are under
 evaluation.
 
 Green Energy Initiative:
 
 Your Directors are happy to inform that your Company has decided to
 foray in promoting Green Energy under Government of Gujarat (GoG) Solar
 Policy 2009 – a step towards control of carbon emission. GoG has
 approved an allocation of 5 MW PV based grid connected solar power
 plant to your Company. PPA for the same has been signed with GUVNL in
 December 2010. Project activities are initiated with efforts to achieve
 commissioning by end December 2011.
 
 Accreditation for Integrated Management System (IMS) under ISO
 certifications:
 
 Your Directors are pleased to inform that during the year under review
 your Company has successfully maintained standard guidelines for IMS
 covering ISO:9001:2008, ISO: 14001:2004 and OHSAS 18001:2007
 certification for Quality Management System (QMS), Environment
 Management System (EMS) and Occupational Health and Safety Assessment
 Series (OHSAS) for its Power Stations at Vadodara and SLPP and has
 achieved renewal of the certification by M/s TUV India Ltd.
 
 Public Deposits:
 
 During the year 2010-11, your Company has not accepted/renewed any
 Fixed Deposit. The Company has repaid on time all claimed Deposits
 along with Interest up to the due date. As at the date of this report 8
 Deposits aggregating to R.1,52,000/- have remained
 un-encashed/unclaimed.
 
 Listing Agreement Compliance:
 
 Equity Shares of your Company are listed on Bombay Stock Exchange Ltd.
 (BSE), National Stock Exchange of India Ltd. (NSE) and Vadodara Stock
 Exchange Ltd.  (VSE) and their listing fees for the 2011-12 has been
 paid and the conditions of Listing Agreement have been complied with.
 
 Insurance:
 
 All the properties and the insurable interest of the Company are
 adequately insured. The Company has also taken necessary insurance
 cover as required under the Public Liability Insurance Act, 1991.
 
 Energy Conversation and Technology Absorption:
 
 Pursuant to the provisions of Section 217(1)(e) of the Companies
 Act,1956 read with the Companies (Disclosures of Particulars in the
 report of the Board of Directors) Rules, 1988, required information is
 given in Annexure-I forming part of this Report.
 
 Directors’ Responsibility Statement:
 
 Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of
 Directors of the Company confirms:
 
 a) that in the preparation of the annual accounts, the applicable
 accounting standards have been followed along with proper explanation
 relating to material departure;
 
 b) that the selected accounting policies were applied consistently and
 Directors made judgment and estimates that are reasonable and prudent
 so as to give a true and fair view of the state of affairs of the
 Company as at 31st March, 2011 and of the profit of the Company for the
 year ended on that date;
 
 c) that proper and sufficient care has been taken for maintenance of
 adequate accounting records in accordance with the provisions of the
 Companies Act, 1956 for safeguarding the assets of the Company and for
 preventing and detecting fraud and other irregularities; and
 
 d) that the Annual Accounts have been prepared on a going concern
 basis.
 
 Corporate Governance:
 
 Your Company has been following good Corporate Governance practices and
 has complied with the requirements of Clause 49 of Listing Agreement. A
 detailed report on Corporate Governance along with Certificate dated
 24th May, 2011 issued by Practicing Company Secretaries is annexed
 forming part of this Report.
 
 Management Discussion and Analysis:
 
 A report on Management Discussion and Analysis dealing with Business
 Operations and Performance, Research and Development, Expansion
 Project, Safety and Environment, Human Resource Developments, 
 Corporate Social Responsibility etc. is annexed forming part of 
 this Report.
 
 Directors:
 
 Dr. P K Das, IAS (Retd.) and Shri P H Rana, Directors of the Company
 retire by rotation at the ensuing Annual General Meeting and being
 eligible, offer themselves for re-appointment.
 
 Shri C L Meena, IAS has ceased to be Director w.e.f.  9th August, 2011
 consequent to his transfer from Finance Dept. as Principal Secretary,
 Revenue Department, Govt. of Gujarat.
 
 Your Directors place on record their deep appreciation for the vision
 and leadership provided by Shri C L Meena, IAS during his tenure as
 Director of the Company.
 
 Shri Atanu Chakraborty, IAS has been appointed as Director of the
 Company w.e.f. 9th August, 2011 consequent upon his nomination by
 Gujarat State Fertilizers & Chemicals Ltd. vice Shri H V Patel, IAS.
 
 Your Directors place on record their deep appreciation for the vision
 and leadership provided by Shri H V Patel, IAS during his tenure as
 Director of the Company.
 
 Shri M S Dagur, IAS has been appointed as Director of the Company
 w.e.f. 9th August, 2011 consequent upon his nomination by Gujarat
 Alkalies & Chemicals Ltd. vice Dr. Guruprasad Mohapatra, IAS.
 
 Your Directors place on record their deep appreciation for the vision
 and leadership provided by Dr. Guruprasad Mohapatra, IAS during his
 tenure as Director of the Company.
 
 Your Directors recommend for your approval reappointment of Dr. P K
 Das, IAS (Retd.) and Shri P H Rana as rotational Directors at the
 ensuing Annual General Meeting.
 
 Particulars of Employees:
 
 The information, as required under Section 217(2A) of Companies Act,
 1956 read with the Companies (Particulars of Employees) Rules, 1975 as
 amended forms part of this Report. Any shareholder interested in
 seeking this information may write to Company
 
 Secretary of the Company at the Regd. Office of the Company. Further,
 there was no employee holding 2% or more of the equity shares of the
 Company during 2010-11.
 
 Auditors:
 
 (i) Internal:
 
 M/s. K. N. Mehta & Co., Chartered Accountants, Vadodara has been
 appointed as Internal Auditors of the Company for the Financial Year
 2011-12.  The Audit Committee of Directors periodically reviews the
 reports of the Internal Auditors.
 
 (ii) Statutory:
 
 The Company’s Statutory Auditors M/s. VCA & Associates, Chartered
 Accountants, Vadodara retire and are eligible for reappointment. You
 are requested to appoint Statutory Auditors and to fix their
 remuneration.
 
 (iii) Cost:
 
 The Government of India, Ministry of Finance has issued Cost Audit
 Order under Section 233(B) of the Companies Act, 1956 to appoint Cost
 Auditor to audit the Cost records maintained by the Company in respect
 of Electricity. Accordingly, the Board of Directors has appointed
 M/s. Kailash Sankhlecha & Associates, Vadodara as Cost Auditor of the
 Company for the Financial Year 2011-12.  Approval of the Central
 Government to their appointment as Cost Auditor of the Company has been
 received.
 
 Acknowledgements:
 
 The Board of Directors places on record its gratitude and appreciation
 to the Government of India, Government of Gujarat, Financial
 Institutions, Banks, Insurance companies, Business Associates,
 Promoters, Shareholders and Employees of the Company for their valuable
 support and faith reposed by them in the Company.
 
                                          For and On behalf of the Board
 
 Date : 19th August, 2011.                             D.J. Pandian, IAS
 
 Place : Gandhinagar.                                           Chairman